Key insights
- The author argues that market timing is possible by exiting the market several months before a crash, rather than trying to predict the exact day. While technically true, this perspective offers limited actionable insight for most investors, as identifying the 'right' time to exit remains highly challenging and could lead to missed gains. The overall impact on US equities is slightly negative due to the emphasis on avoiding losses over maximizing returns.
People keep pretending timing the market is impossibru!!
But maybe that is because they dont use the rational definition.
Timing the market doesnt mean you took your money out 1-2 days before a major crash happens.
Yeah that would be absurdly lucky, nobody can predict the future to such a level of detail.
But people can time the market by taking their money out a quarter before, 6 months before, even a year before the crash.
A single year of gains prior a crash means very little when the drop is catastrophic that leads to chain sell offs.
In other words, you can time the market.